Tesla shorts lose more than $1 billion on post-earnings surge


Investors betting against Tesla lost more than $1 billion Thursday as the company’s shares rallied the most in over two years, according to estimates from financial technology firm S3 Partners.

Tesla stock traded more than 10 percent higher Thursday at $331.90 per share, meaning short sellers have taken over a $1.1 billion mark-to-market loss on their 35.1 million of shares shorted, estimates S3. With the price move Tesla’s short interest is now $11.7 billion and remains the most shorted stock in the U.S. market, according to S3’s head of predictive analytics Ihor Dusaniwsky.

“Today’s $1.1 billion mark-to-market loss has turned a profitable year for short sellers, they were up $276 million in year-to-date mark-to-market profits prior to today’s rally, into a loss,” Dusaniwsky said in an emailed statement. He added that shorts are now down $831 million in year-to-date mark-to-market losses.

Tesla chief executive Elon Musk has actively criticized and trolled investors short his company’s stock this year. Most recently, the CEO bashed Greenlight Capital’s David Einhorn’s bet against his company after the hedge fund manager said the firm’s bet against Tesla “was our second biggest loser” in the most recent quarter.

Musk took to Twitter, retorting that he would send Einhorn “a box of short shorts to comfort him throughout this difficult time.”

“Tragic,” Musk quipped.

“We believe the sustainable production rate for the second quarter of 2018 is most likely below the 2,000 vehicle mark the company achieved in the final week of the [first] quarter,” Goldman analyst David Tamberrino wrote Tuesday. “We see the company likely sustaining Model 3 production around the 1,400 per week mark.”

Musk has also pushed back against Wall Street analysts, including those at Goldman Sachs, which continues advise clients to sell Tesla stock. The CEO called out Goldman back in April after the bank issued a gloomy forecast.

“Place your bets,” Musk quipped on Twitter, appearing to challenge would-be sellers to exit at their own risk.

Tesla declined to comment on this story.

— CNBC’s
Michael Sheetz
contributed to this report.

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